Ethereum (ETH) price is one of the top gainers in the crypto market today, April 14, after a 9.27% gain in 24 hours. The gains come as the market defies tensions in the US-Iran conflict. Moreover, the US Securities and Exchange Commission (SEC) has issued a new guidance on decentralized finance (DeFi), and this is also fuelling the ETH rally. As a rounding bottom forms and technical indicators turn bullish, can Ethereum price break $3,000? Let’s explore.
SEC Updates DeFi Regulations Amid ETH TVL Decline
A recent report by the SEC could boost the adoption of DeFi products and drive an Ethereum price rally after the regulator stated that certain platforms that enable DeFi transactions do not have to register as a broker or a dealer. Some of these platforms include wallet extensions and mobile apps.
The development has stirred the interest of the crypto community, with users saying that it shows that the SEC is moving forward with providing regulatory clarity amid the delay of the US Congress to pass the CLARITY Act.
“This SEC is already preparing to implement a CLARITY-like regime, but CLARITY still needs to be law, because staff guidance is not law, commissions change, and future admins can reverse this unless Congress codifies it,” said Galaxy’s head of research, Alex Thorn.
The SEC’s focus on regulating the DeFi space comes at a time when Ethereum’s DeFi TVL has dropped significantly. Data from DeFiLlama shows that this metric has dropped from the 28.39 million ETH recorded on February 6 to 23.53 million ETH at press time. This means that the TVL has dropped by 4.86 million, worth around $11 billion, in two months.
The new DeFi regulations could end up supporting a bullish long-term Ethereum price prediction if they revive Ethereum’s TVL.
Ethereum Price Forecast as Bullish Pattern Signals $3,000 Rally
Ethereum price has created a rounding bottom, which shows that the momentum is slowly shifting from bearish to bullish. A steady recovery has happened since late March, with the price surging from a low of $1,938.
The rise that has seen ETH price sustain levels above $2,000 for the last two weeks stems from buying activity. As seen on the daily chart, the RSI has been climbing gradually, with the higher highs confirming that bullish momentum is growing strong. Moreover, even with the gradual rise, the RSI is still not at overbought levels, showing that there is room for ETH to rally higher.
The rounding bottom’s neckline at $2,396 forms the main resistance level that will determine where ETH price heads next. If Ethereum breaks this resistance and makes several closes above it, it could kickstart a 23% rally to around $3,000.
The EMA indicator also supports the likelihood of more gains happening with the 20-day EMA crossing above the 50-day EMA. This shows that the short-term momentum is in favor of bulls. If this bullish breakout fails, and ETH price faces resistance near $2,396 again, it will show that sellers are placing sell orders at this price and driving a trend reversal.
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